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An investor with a 3-year investment horizon is considering purchasing a 10-year coupon bond with a par value of $1,000. The annual coupon rate is

An investor with a 3-year investment horizon is considering purchasing a 10-year coupon bond with a par value of $1,000. The annual coupon rate is 10% and the price is $1,000. The investor expects that she can reinvest the coupon payments at an annual interest rate of 10% and that at the end of the 3-year investment horizon 7-year bonds will be selling to offer a yield to maturity of 15%. What is the total return for this bond? Assume semiannual coupon payments and semiannual compounding.

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